To everyone who says AAPLs upside from here may be limited due to the law of large numbers or some such (as if the NSA will ever stop handing out free student loans to make sure it has voluntary tabs on everyone) oh how wrong you are.
Meet The Extreme Super Rich: A List Of The 80 People Who Own As Much As The World’s Poorest 3.6 BillionSubmitted by Tyler Durden on 01/28/2015 15:31 -0500
"Eighty people hold the same amount of wealth as the world’s 3.6 billion poorest people, according to an analysis just released from Oxfam. The report from the global anti-poverty organization finds that since 2009, the wealth of those 80 richest has doubled in nominal terms — while the wealth of the poorest 50 percent of the world’s population has fallen." There you have it. The reason the wealth of the richest has doubled since 2009, is because “it’s not a recession, it’s a robbery.” Central bank and government policy has done this, it is no accident.
- Saudi Arabia’s New King Probably Will Not Change Current Oil Policy (BBG)
- Saudi King’s Death Clouds Already Tense Relationship With U.S. (WSJ)
- Oil Pares Gains as New Saudi King Says Policies Stable (BBG)
- Kuroda Says BOJ to Mull Fresh Options in Case of More Easing (BBG)
- U.S. pulls more staff from Yemen embassy amid deepening crisis (Reuters)
- Putin Said to Shrink Inner Circle as Hawks Beat Billionaires (BBG)
- A Few Savvy Investors Had Swiss Central Bank Figured Out (WSJ)
In an awkwardly uncomfortable non-cheerleadery few minutes on CNBC this morning, he-who-must-be-listened-to (when he is buying stuff and not selling it) - Carl Icahn - dropped a few truth bombs on an unsuspecting Scott Wapner. Starting with warnings about energy sector debt, fearing a surge in defaults and "what management can do to hurt you" if you own that debt, Icahn then moved on to discuss today's ECB move and its implications. Confirming his "extremely cautious" stance to the overall market, Icahn explained how "the reason the stock market has gone up is because of the Federal Reserve," and now the rest of the world is jumping on the bandwagon "with all this issuance of money," and the implicitly strengthening USDollar "will come home to roost at some point." While not pointing to a specific point in time, Icahn concluded, "you do have to be extremely cautious and we have hedges on.. and it's too early to buy oil stocks/bonds."
- ECB to decide on bond-buying plan to revive euro zone (Reuters)
- Draghi Is Pushing Boundaries of Euro Region with QE Program (BBG)
- Investors Wonder Whether ECB Will Do Enough (WSJ)
- Treasuries Drop With Bunds Before ECB; U.S. Futures Rise (BBG)
- European shares hit seven-year high (Reuters)
- At least eight civilians killed in shelling of Ukrainian trolleybus (Reuters), both sides blame each other
- OPEC Will Blink First in Battle With Shale Drillers, Poll Shows (BBG)
- China Injects $8 Billion Into Banking System (WSJ)
- New York says Barclays not cooperating in 'dark pool' probe (Reuters)
Earlier today, just after the market open, the one company that everyone had once again piled into, and which as of September 30 was the most held company by the hedge fund community with at least 175 "smart money" institutional fans based on expectations that with every other stock and asset becoming increasingly illiquid, at least this one would preserve its liquidity come hell or high water, flash crashed. The company is Apple, So what happend? Between 9:49:54 and 9:50:43 Eastern, AAPL plunged from nearly 6%, from $117.69 to $111.27, a moved which wiped out one Transcanada (or one Travelers, or one Lukoil, or one Carnival, or one Christian Dior, or one Hyundai Motor Company, or one Takeda, or one State Street) in market cap.
There is a saying that you don’t ring bells at the top. It’s not really true. Every time the market forms a major peak, at least in the last 15 years, there are usually a preponderance of signs of excessive speculation and leverage.
A few points the "stocks are cheap" crowd should consider.
Looking for answers to both financial safety as well as financial freedom in the same light or viewpoint where it seems one only needs to “think like a billionaire” or “tweak” or “slightly modify” perceptions on how one approaches these financial markets today – will hurt more than it will help. The Wall Street everyone believes they are dealing with today is just in name and memory. What made sense just 6 years ago not only doesn’t but rather if you try to apply any sense that resembles “common sense” you might as well be asking the Cheshire cat for a more straight answer. "How exactly are you handling the stresses and strains having to basically push sound fundamental theories or market underpinnings aside and now trade and position money at risk based solely on what some Central Bank will do next?" This is the avenue I wish Tony had driven or sought.
The S&P 500 is now up 12.5% from the Bullard lows in mid-October and has broken to new record highs over 2048 - within 2 points of Goldman Sachs year-end target. Since Bullard's comments, the S&P 500 has been up 19 days and down only 5 (and today will be the 23rd day in a row of closing above its 5-day moving-average - a record!) WTI crude oil prices are collapsing back to cycle lows below $75 but perhaps most notable is the plunge in 'implied correlation' - which measures the relative demand for individual stock protection over index macro protection. Implied correlation is at a record low - which suggests capitulation among those with macro overlays (like Carl Icahn)...
It seems Carl Icahn will not be going activist on the S&P500 after all. During the Reuters Investment Outlook Summit in New York on Monday, the 78 year old billionaire said that "I am still concerned that one day you'll see a break like you had a few weeks ago but it won't come back."
Overnight weakness from Japan (NKY -3%) and USDJPY slowly leaked away as Europe was bid - bouncing higher on Draghi's SovQE "whatever it takes" comments (and multiple broken markets), but once he stopped speaking stocks faded to the lows of the day at the European Close. Once it was just the American algos playing, the S&P and Dow ripped back to green. However, Small Caps, Nasdaq and Trannies were not playing along, nor was VIX or HY Credit. The USD surged 0.45% (on EUR weakness) which stalled the bounce in commodities. Gold flatlined through the US session (-0.25%) with Silver -1% (bouncing this afternoon). Oil prices slipped 0.5% again (but above Friday's lows) at $75.50. Treasury yields rose 1-2bps on the day (but 5-6bps off the overnight lows as Europe opened) but flatlined during US session. Most notably, it seems many feel like Carl Icahn that a major correction is coming and hedging via VIX and HY credit was significant.
As its recent 10-K confirmed, AAPL's domestic cash - the amount of cash available for such corporate transactions as dividends and buybacks - had dropped to just $18.1 billion (and that is including the several billion in commercial paper issued in fiscal Q4), the lowest domestic cash hoard since March 2010, a time when AAPL's offshore cash was a tiny $24 billion compared to the near record $137 billion last quarter! So knowing full well that a buyback a day keep the Icahnator away, AAPL, urgently looking to refill its domestic cash since its offshore cash remains untouchable (absent being taxed on its repatriation), did the only thing it could do: prepare to issue more bonds, which is what we forecast would happen a few weeks ago, and what the WSJ overnight confirmed is already in progress.
- To salvage his presidency, Obama faces pressure to reboot - but will he? (Reuters)
- Pro-Russian separatist Zakharchenko wins Ukraine rebel vote (Reuters)
- Russia's Recognition of Ukrainian Separatist Election Is 'Incomprehensible,' Germany Says (Moscow Times)
- Man Running World’s Biggest Wealth Fund Tackles China Riddle (BBG)
- Russian Supply Underpins Global Oil Glut (WSJ)
- Argentina accuses Procter & Gamble of tax fraud, says suspends operations (Reuters)
- ECB Skips Fireworks for Day One of New Role as Supervisor (BBG)
- HSBC Hit by $1.7 Billion of Provisions (WSJ)